Straits Times
21 November 1997

Singapore's bellwether Straits Times Industrials
Index dropped 39.94 points to end the day at
1641.03, 2.38 per cent down.

A new reform package announced by Seoul failed to
stanch South Korea's haemorrhaging currency and
stocks. The won plunged to a new low of 1,139 to
the US dollar and the Seoul stock market closed
the day down 2.8 per cent to 488.41 points.
Other Asian currencies tumbled in reaction to the
South Korean slide.

Malaysia's markets crumbled after the government
announced a takeover of the Bakun Hydroelectric
project, read by some as a rescue act for its
main developer Ekran Berhad. That came a bare two
days after cash-rich United Engineers Malaysia
paid M$2.3 billion (S$1.08 billion) to buy shares
in parent company Renong in another apparent
bailout.

Its currency also slumped to a new low, dragging
down the Singapore dollar with it. The ringgit
closed at 3.5040 to the US dollar, while the
Singdollar closed at 1.6000 to the greenback, a
level not seen since February 1994. A Singdollar
would fetch M$2.19.

With yesterday's 11.08 drop by the KL Composite
Index, the key Malaysian bourse has dropped 20
per cent this week and seen nearly 57 per cent of
its value wiped out since the beginning of the
year. The Stock Exchange of Thailand has fared
better in comparison, dropping 49.23 per cent for
the period.

Considered in US dollar terms, which is the way
many of the foreign investors now fleeing Asian
markets calculate their holdings, the losses are
even worse.

Malaysian stocks would have shed close to 69 per
cent against a 67 per cent loss in Thailand, over
55 per cent eroded in Philippines stocks and
about 59 per cent lost in Indonesia.

"We are heading towards a miserable Christmas and
there is no guarantee the new year will be any
better," analyst Alison Seng of Standard and
Poor's MMS told The Straits Times yesterday.
"Singapore is reacting to Malaysia because we
have a lot of investments there. The Indonesians
and the Taiwanese and Hongkongers are reacting to
Korea. The weakness catches on," she said.
Elsewhere, Hongkong's benchmark Hang Seng Index
fell 103.68, or 1 per cent, to 10,050.68.

Indonesian stocks fell 4.7 per cent to its lowest
point in four years as the Jakarta Stock Market
Composite Index fell 19.52 points to 396.13, its
lowest close since August 1993.

Only Tokyo's benchmark Nikkei 225 index seemed to
have gained any real confidence yesterday, rising
466.03 points, or 2.94 per cent, to 16,308.49.
Investors were cheered by reports of possible use
of public funds to assist financial institutions
burdened with massive bad debts

.
Thailand appeared to balk the regional trend
partially. The baht was unscathed but the stock
market fell 2.8 per cent to 422.18, an eight-year
low. The Philippine peso was off slightly at
34.81 to the greenback from Wednesday's 34.73 and
the composite index of stocks ended virtually
unchanged at 1872.75.